Financial instruments. What we've seen since the 1970s is a dramatic increase in a series of phenomena that have had a stimulative effect on the changes in the financial system that have brought us to the gleaming and shiny metal and steel business that's over there.
So they are creating Central Bank reserves out of nothing. The Bank of England creates Central Bank reserves by increasing the available credit in the settlement bank's account with the Bank of England. The settlement bank in return posts bonds, or sells assets as collateral for the reserves.
This is the government's response to the bank bailouts and is necessary in a debt/based monetary system where increased purchasing power is the result of growing debt and where a diversification of debt provides overall stability and market confidence.
Not if it doesn't make a profit for them. Instead, they use their licence to print money to gamble on the financial markets and push house prices out of reach of ordinary people by pumping hundreds of billions of pounds into risky mortgages. This is exactly how the banks caused the financial crisis, and now the rest of us are being asked to pay for it. If we can't afford to run hospitals and build schools, can we really afford to subsidise the financial industry? Should we have to live with less so the bankers can have more?
It's fascinating, this emergence of digital currencies, how it's transformed everything, really. Because it just completely unleashed private banks to dominate and create the money system that works for them and works for the people who run private banks.
The banking system has such a huge impact on the world, but only because it supplies our nation's money supply. We have to protect them. We have to subsidise them. We have to allow them to continue because the disaster of a bank collapse affects us all in a huge way.
So if we have a money system where the rules value community and connection between people within communities, over time you build up a better and more wealthy basis for a diverse local economy.